Problem 1: Reggie, an accountant decides to start a business to provide clients with assistance in preparing their tax returns. He intends to operate as a sole proprietorship using the following name:
Justin Trudeau'$ Canada Revenue Agency Tax Services Inc.
Identify four deficiencies in the above business name, stating the applicable sections of O. Reg. 399/21 under the Business Names Act that justify your 4 choices. (Note: identify the relevant section number and briefly explain how the proposed name offends each section.)
Problem 2: Two accountants, Emerson and Aiden have decided to form a limited liability partnership. Assume Aiden bought $17,000 worth of computers and printers for the partnership's office. The computers and printers were purchased on credit and this debt remains outstanding. Also, Aiden's assistant made an error on one of Aiden's client's tax return. Now, the client is suing for economic loss in the amount of $18,000 ("the lawsuit").
Referring to the appropriate legislation, discuss each partner's potential liability for:
a. the lawsuit
b. the outstanding debt for the cost of the computers and printers.
Problem 3: Jack, Sarah, and Kayla are lawyers who have a joint legal practice. They have recently created a corporation for this purpose. Each lawyer owns shares in the corporation and each pay for their own practice insurance. Last month, Sarah missed a limited period for a client.
a. What type of corporation do Jack, Sarah, and Kayla have? Explain how you determined your answer.
b. Assume Sarah's client is now suing for financial lost resulting from the missed limitation period. To what extent is each partner potentially liable under this claim? Explain your answer briefly.
Problem 4: Premium Real Estate Developers is a successful real estate development business owned and operated by Charles Tate and Harrison Smythe as a general partnership. The partners have now decided to seek investors in their business but want to maintain primary control of the business. They realize that this will require a change in business format.
Answer the following questions:
A. Identify two types of business formats that would be suitable in this scenario.
B. Chose one of the business formats you identified (for part a), and identify two advantages and two disadvantages this option provides for the business owners